Final Report

Show Notes

Education Needs to Strengthen Its Approach to Monitoring Colleges' Arrangements with Online Program Managers | US GAO

From Reopen to Reinvent: (Re)Creating School for Every Child Hardcover – July 13, 2022

Transcript

Michael Horn:

And so here we are, the end of season five of Future U. when we take our customary summer break. This has been a season of many highlights, as well as some firsts in our podcast. It's also been a year that as we come out of the pandemic, albeit slowly, higher ed is starting to think about how to navigate what's next.

Jeff Selingo:

No doubt, Michael, this year as we recorded our 100th episode, visited three campuses to record the podcast in front of an audience in real life, I think we both came to realize that the future remains more ambiguous than ever for much of higher ed. The sector as a whole is grappling with the end of the federal stimulus dollars, as well as how they support the post-pandemic student, and how they think about their own workforces. Also, they're thinking about what level of flexibility and personalization they can really provide. And can they do that well? We'll be talking about those issues as well as providing a few updates on this episode of Future U.

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Michael Horn:

I'm Michael Horn.

Jeff Selingo:

And I'm Jeff Selingo.

Michael Horn:

Jeff, I'm feeling what I suspect many of our listeners who work in higher ed feel when the end of another academic year sort of sneaks up on them without warning. For us the end of another season of Future U. has done the same. This episode though  gives us a chance to catch our collective breath and catch up with each other. We get to reflect on the last year, and offer a prediction for what's next. And then I know you have a question about the wicked problems facing higher ed and the big fix, if you will.

Jeff Selingo:

Yeah, that's right, Michael. But first, before we jump into this episode for our regular listeners, I think probably some updates from previous guests and topics on the show might be in order.

Michael Horn:

Yeah, it sounds like a good idea, Jeff. So first up are Judy Sakaki and Michael Baston. We had Sakaki, the president of Sonoma State and the Cal State system, on last season. And she's announced that she's stepping down amid a growing sexual harassment scandal involving her husband from whom she's now separated, that led to a no confidence vote among faculty on campus Jeff.

Jeff Selingo:

Michael, we also had a job change with Michael Baston who was on last season as president of Rockland Community College in New York. He's moving on to become president of Cuyahoga Community College in Cleveland this summer. So congratulations to Michael.

Michael Horn:

And then from this season, another one of our firsts, we had these Higher Ed 101 episodes. And of course we did one focused on OPMs or online program managers with Phil Hill. He mentioned in that episode about an expected report to Congress from the GAO on OPMs and that report has been released. So we'll add it to the show notes. I think the headline was that the GAO essentially suggested more robust monitoring of OPMs through their audits so that they don't run afoul of federal laws governing student aid. But otherwise, Jeff, there wasn't much smoke there, no scandals or findings of OPMs doing questionable things.

Jeff Selingo:

And finally, we had Jeff Senese, President of Saint Leo University in Florida on this season to talk about its expected acquisition of Marymount California University, and the idea of a national network of Catholic colleges. On that episode, Senese mentioned what he called the crazy process compared to the rest of the country that its accreditor SACS had to approve what he called an acquisition, but he was careful to say SACS called a merger consolidation. Well, it turns out that the accreditor's process indeed was an obstacle and the merger plan with Marymount California University was scrapped because of complications in getting approval from the accreditor, SACS in this case. A few days later, when that happened without anyone to take on Marymount's debt of around 3.7 million, the trustees of that university decided to close its doors this summer. And so that's it for the major updates, Michael. Any reflections you have on the past year and what might that might portend for the year ahead?

Michael Horn:

Sure, Jeff. So just a quick reflection coming out of our campus tour episodes is how different campuses are thinking about hybrid learning, which of course has been a hot topic in higher ed. You have on the one hand, I would say the excited campus in Northeastern to the highly skeptical in Georgia Tech and Emory to the let's keep an eye on it, but I'm not so sure it's a good idea in UCLA. So it's interesting just to see the range on hybrid learning, even coming out of our episodes. In terms of what might be coming in the year ahead and predictions, I won't center it on colleges closing or emerging, because I think my past prediction around consolidation remains intact, especially once federal funding dries up, but I want to go in a related direction, Jeff, which is look, the economy seems like it might be slowing down right now.

There are big fears around a recession and a 1970s style stagflation. Traditionally a recession, Jeff means a rebound in student enrollment. So it's possible that community colleges will dig out of their dramatic declines over the last few years. But my prediction is that I don't think we're going to see a big rebound in enrollment across the higher ed sector because sticker prices I think will rise also, thanks to the inflation that we see in the economy right now. And given that the high cost of many colleges, even before those increases has turned so many away from college recently, I think those further tuition hikes will scare off many more students. And so look, the demographic decline is just around the corner, but this is where my prediction nets out is that yes, there's a recession potentially in the offing, but the decline in enrollment, it may stabilize some, but I don't think it's going to rebound Jeff. What about you, reflections, predictions?

Jeff Selingo:

Well, Michael, I think a reflection is really on both the leadership challenges facing higher ed now, but also the talent needs in colleges and universities. And ever since we were with Gene Block, the Chancellor of UCLA on the second stop of our tour, I've been quoting him left and right around this idea of it used to be that people wanted to work for colleges, universities. They believed in its mission, especially for staff which really run these city-like campuses. It was a good place to work, good benefits and they maybe got some benefits for their kids to go there, but there was a sense of pride in mission. And he was pretty clear that that's not necessarily the case anymore, particularly in economy like California, where universities can't necessarily keep up with the private sector and where you have to actually go into a campus-based place to go to work where at many other employers you can actually work from home and that's becoming increasingly difficult for most universities to compete with because they need their people on campuses.

And I think this is really interesting because almost anything that we're talking about in terms of the future of higher education requires talent and staff. And if colleges and universities are going to have trouble hiring people because they can't pay for them, they can't afford them or because they can't offer the workforce benefits that they used to be able to offer, including the idea of working from home, I think that's really going to slow down, in some cases, innovation in higher ed. And so it's one thing that I keep reflecting on that Gene Block told us. In terms of a prediction, one thing I'm watching closely is the end of the government stimulus dollars from the pandemic going to higher ed. We recently had a report come out from S&P Global Ratings. And they said that the median college received more than $13 million in government relief funding over the course of the pandemic.

And that accounted for just over 4% of adjusted operating revenue at more than 30% of colleges in fiscal 2021. And that really covers just the rated institutions. So remember those tend to be the better institutions in the US. And what's really going to happen now is we're going to start to see the end of the stimulus funding coming here in the summer, this summer. And that's really going to open up a lot of colleges and universities, especially given growing inflation, the possibility of a recession, into serious financial problems in some cases. And so sure there might be closures and consolidations, but I'm hopeful that this actually might force some people to kind of rethink their business models.

So we might see, for example, more public private partnerships around health and student services and those things that are not core businesses of higher ed. Because again, I think these very tight budgets are going to force universities and colleges to think differently. I think we're going to start to see deeper academic partnerships and perhaps finally new markets of students. In other words, that they're going to look for new markets of students, particularly around the adult students. So I think that too many colleges used the federal stimulus money to put a hole in their leaking dike that largely those financial problems that they were well aware of even before the pandemic.

But what I'm hopeful now is that with the end of that federal stimulus dollars, it's really going to force colleges and universities because they're not going to be able to lean on traditional enrollment. They're not going to be able to lean on their traditional business models. Hopefully they will start to force them to think differently because otherwise I think then we will see some closures in consolidations. Like we saw in California after the Jeff Senese and Saint Leo deal died. So that's my prediction for the coming year. So Michael, we're going to take a quick break here. And when we come back, we're going to focus on some of the big fixes for some of higher ed's knottiest problems. When we come back on Future U.

Sponsor:

Support for this podcast is provided by the Bill and Melinda Gates Foundation, which is committed to preserving and expanding educational opportunity for today's students now more than ever. Learn more at postsecondary.gatesfoundation.org. This episode is also supported by Salesforce.org. Salesforce.org is proud to partner with institutions like yours to build a better future for all. We believe creating a technology enabled, personalized and continuous experience throughout the learner life cycle is so critical to driving student and institution success from anywhere. Learn more at salesforce.org/highered.

Jeff Selingo:

Welcome back to the finale of season five for Future U. Michael, back in May, I was at the Milken Global Institute conference in LA and at a dinner one night where I sat next to Tom Kalil, the Chief Innovation Officer at Schmidt Futures. And prior to Schmidt Futures, Tom served in the White House for Obama and Clinton helping to design and launch national science and technology initiatives. And during dinner, he asked me a really interesting question that I wanted to bring to us here on Future U. and here was what he asked. He said, what one thing, one, one, and he was very clear on the one thing, would you do to fix higher ed? And then more importantly, how would you do it?

Because one of the things he told me is that when he was at the White House, plenty of people came into the Oval Office to ask for a fix or to suggest a fix. But then they were never able to articulate how to do it. Would you do it through legislation? Would you do it through funding from a foundation? Obviously in the federal government, you had a lot more levers that you could pull but they would never then be able to give a specific suggestion about how to do it. So I wanted to bring that question to us here on Future U. What's the one thing you would do to fix higher ed, and then how would you do it?

Michael Horn:

Such a good question, Jeff. It's a tough one though, because I think it obviously depends on how one defines what's quote, unquote, wrong with higher ed. Like, what is the problem? And with anything that's hard because A, everyone says spend 90% of the time or whatever the saying goes on defining the problem and then the solution falls out. But second, higher ed as we've discussed many times is really a varied set of very different kinds of institutions with very different challenges. So I think it is difficult and I'll say my head goes a couple places, but then I'll give you my ultimate one. One could be that state governors, for example, start hiring based on skills and not degrees. That would force the higher ed market to much more rapidly, I think take seriously skills based learning and looking at what do they produce in students. I think that's one avenue.

A second one, I'll harken back to the problem you just laid out before with the federal financial relief, the stimulus dollars drying up. I mean, I still can't believe the statistic you said that the emergency government funding accounted for over 4% of adjusted operating revenue at more than 30% of colleges in fiscal 21. Just for our listeners frankly, if you have a surplus of like two to 3%, you're doing pretty well in higher ed. So for 4% to disappear, wow, I don't even know what the solution would be, but that's a problem. And then the one, I guess I'll focus on is I think a big problem is what we've talked a lot about on this podcast this particular year, which is value in higher education for students. The outcomes relative to what's expended in resources and time and money.

And so my big fix Jeff would be to reboot the quality assurance system entirely, decouple accreditation from financial aid, focus on student outcomes for student aid so that institutions that offer a poor return on investment struggle to get federal dollars, allow new entrants to come in, create more disruptive competition. So I think Jeff, that would be a policy and a regulatory fix, which probably means that it relies on Congress doing something. So maybe we can't rely on that, but I do think there are a bunch of steps the Department of Education could take in the interim on the regulatory front, like for example, allowing in new accreditors that might allow some new entrance into the higher ed landscape. And there is some noise brewing on that front that could be interesting and worth watching over the next year or two. Jeff, what about you? What's the big fix? I'm curious what you said.

Jeff Selingo:

Yeah. So I want to focus on, well, first of all, I didn't say anything to Tom that night, because I had to think about it because if I have one shot to suggest something, I want to make sure it's the right one. But as I've been thinking about it over the last couple of weeks, it's really around teaching and learning because I think scale is on the mind of everyone. We've heard that recently in our 100th episode, just the growing number of learners. And so we also heard Gene Block talk about teaching at UCLA and how special it is or he was also referencing kind of the model of a Swarthmore. Or we heard Rick Levin, the former president of Yale, of course on this season talk about the same thing when we were discussing about growing highly selective colleges and universities.

I think we all know that's not really going to happen to the scale that we need because the way that these institutions are designed and how good and I think maybe good in quotes, teaching and learning is at these places. But I think for the most part we know they are. Right. You have these transformative learning experiences at these highly selective institutions. So how can we scale that and sustain that transformative learning for everyone? Why shouldn't everyone have access to quality teaching and learning? So I think that's the big problem to solve. So how do we do it? To me, we just have to put effort and money behind it, right, in much the same way we do with the cancer moonshot or we put money behind the space race. I'm serious. I think we have to put really serious money and the bully pulpit from the federal government to say that everyone deserves high quality teaching and learning and transformative learning.

And I think it has to come from the federal government. I think it has to come from a coalition of foundations who can put real money together to provide incentives to faculty members, to do as much research and dissemination as they do about their own disciplines in teaching and learning. We all know that there's a lot of good research to be done. There's a lot of good research that has been done on teaching and learning and it needs to be disseminated, but we just don't put it on the same pedestal in higher ed as we do almost every other discipline. And there's no reason that it shouldn't be. And there's no reason that everyone doesn't deserve high quality teaching and learning and transformative learning experiences much like the way Gene Block talked about UCLA or Rick Levin talked about Yale.

So Michael, we've come to the end of another season of Future U. I'm really looking forward to digging into our sixth season this fall, when we're going to be back on the road again with the Future U campus tour. We're going to be stopping at Bowie State in Maryland. But in the meantime, I think we have three of the greatest months in the English language in front of us, June, July, and August. So what are you looking forward to this summer?

Michael Horn:

Jeff I have a new book as you know, coming out on July 13th, titled From Reopen to Reinvent. So if you're interested in K12 schools and what their big fixes ought to be coming out of so much devastation over the past couple years, grab a copy on Amazon or at your local bookstore, of course. But with that shameless plug over, I guess I'm not sure how relaxing my summer will be given travel around the book and that I'm already working on my next book after that. I'm not quite ready to talk about it, but will do soon. But in the interim, I'm excited to be with a lot of educators in different parts of the country talking about From Reopen to Reinvent. And personally, we've got a bunch of trips planned in the Northeast, which should be great opportunities to unplug Jeff. What about you? Any big summer plans?

Jeff Selingo:

Well, Michael, I can't wait to dig into Reopen to Reinvent. We're definitely going to do a show on that next season. So something to look forward to for all of our listeners. We're going to be traveling with the family a little bit, making up for some two years of not traveling very much with COVID. The kids are going to sleepaway camp for the first time this year. So I'm really excited to have two weeks off, a little break from the rest of the family, for my wife and I. My oldest is going to seventh grade at a new school. So there will be a little help transitioning her to that big change. But most of all, I just want to take it easy as some of our listeners know because I missed the Future U. campus tour in Atlanta. I finally got COVID after avoiding it for two and a half years.

I got it right around the time we were supposed to be in Atlanta for the Future U. campus tour. So I'm really looking forward to just resting up this summer and taking it a little bit easier. And I guess the big work project is speaking of books is finishing up my next book proposal, not ready to talk about it yet, because I don't want to jinx it and not quite exactly sure where it's going, but I definitely have a lot of time this summer to be thinking about it and always by the way, looking for ideas from our listeners. So if you have ideas that of books you think should be written, please reach out. Oh, and one other thing, Michael, that dog you hear in the background, Quincy, I'll be taking care of him as well this summer.

Michael Horn:

Well, I'm going to hold you to account for that Jeff. I can't wait to hear more about it in the fall, but until then to all of our loyal listeners, thank you for another great season. The questions, engagement has been just terrific and pushed both Jeff and I. And of course, please tell your friends about the podcast because summer is a good time to catch up on all our shows and of course, rate us wherever you listen to your podcasts so that others can learn about the show. We have a new feedback button on our website as well to suggest guests or ask questions for us to discuss on air. So check that out as well. And then until we see you in September, have a great and healthy summer.